Taxes in Spain for non-residents and foreigners: Taxes payable on the purchase or sale of a property

This article is part of our guide Taxes in Spain for non-residents and foreigners which you will find in our Taxes in Spain for foreigners section.

Impuesto sobre Transmisiones Patrimoniales (I.T.P.)

This is a tax payable when you purchase either agricultural land or a house/apartment/building plot from a private owner.

It is generally 7% (it depends on regions) of the declared value of the property as expressed in the Escritura de Compraventa (Deed of Conveyance).

This has led people to be tempted to under-declare the value of the property. Though this practice was and is widespread, it is a mistake. Penalties are payable in respect of abusive under declarations which, in addition, can lead to Capital Gains Tax headaches at a later date, as the declared value on your purchase is the base line used by Authorities when assessing the Capital Gain you make on the disposal of the property.

Impuesto sobre el valor añadido (I.V.A.)

This is the Spanish equivalent of VAT.

It is paid instead of I. T.P. when you buy from a Promoter rather than the private individual.

At present, the tax is charged at the rate of 21% on building plots and on additions carried out subsequent to the construction of properties.

It is charged at the rate of 10% on the construction of a house and any associated buildings, excluding commercial premises.

It is also charged at the rate of 10% on both the plot and the house if you purchase both at the same time.

In addition to IVA you will also have to pay a document tax or stamp duty (IAJD) at 1% (this depends on regions) of the purchase price on your purchase from a developer.

Land Registry Fees

These vary according to the locality, type and value of the property. They are not strictly taxes but rather administrative fees but, for the sake of completeness, are referred to in this document.

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